Heritage Conservation Areas: Benefits
“The development and adoption of a district plan provides the community with an important tool for ensuring the integrity and sustainability of the area’s unique cultural resources and for managing the impacts of cultural tourism on the environment.” – (source)
Of the benefits of heritage conservation areas (HCAs), the City of Victoria states, “Heritage conservation areas help to protect the character and charm of the special places in Victoria and help to shape the unique identity of a neighborhood within the community as a whole. Heritage is all about understanding the value of our community’s past, what makes us who we are and what we wish to become. Our history is our future…and our future will become our history.” (source)
Although not based on BC’s legislation, Heritage Conservation Districts, which is part of the Ontario heritage toolkit, offers benefits that are relevant for the BC context:
- A unique planning framework that respects a community’s history and identity. District designation is one of the best ways to ensure identity is conserved and heritage conservation objectives and stewardship are respected;
- A form of recognition and commemoration for the heritage values within an area and a way to sustain these values. HCAs allow heritage properties and relationships to be identified and protected.
- Home owners, entrepreneurs, local government, and property developers appreciate the benefits of culturally vibrant and established urban and rural communities. District designation contributes towards the development of a rich physical and cultural environment and the promise of continuity and stability into the future. These are often attractive areas for commercial, residential and mixed-use investment.
- The relationship between heritage and cultural tourism. Designation can be used both to encourage and manage tourism activity in rural and urban areas.
(source)
Property Value and HCAs
A typical fear of property owners is the loss of property value on the real estate market, but the evidence suggests this is generally not the case.
Several studies explore the relationship of property valuation and designation and register listing. While the comparisons are challenging, the evidence indicates heritage-designated properties are more likely to increase in commercial value.
Perhaps the most compelling research comes from Robert Shipley, who wrote in Heritage Designation and Property Values: Is there an Effect?:
“Almost 3,000 properties in 24 communities were investigated, in what is believed to be the largest study of its kind ever undertaken in North America. It was found that heritage designation could not be shown to have a negative impact. In fact there appears to be a distinct and generally robust market in designated heritage properties. They generally perform well in the market with 74% doing average or better than average. The rate of sale among designated properties is as good or better than the ambient market trends and the values of heritage properties tend to be resistant to down-turns in the general market.” (source)
“The rate of sale among designated properties is as good or better than the ambient market trends and the values of heritage properties tend to be resistant to down-turns in the general market.”
The following information comes from one of the largest Canadian studies, which surveyed 24 Ontario communities and 3,000 properties. Some of the findings found in this report:
- Considering house prices, 74% of heritage properties performed average or better than average in the market.
- The rate or number of sales among designated properties was good or better than the comparative market.
- Values of heritage properties tend to be resistant to down-turns in the general market.
Taking a closer look, the study indicates approximately 59% of the heritage properties performed better than the average property. 15% of the heritage properties were comparable to the average price trend. And 26% performed below the average price trend. This suggests that three out of four times, a heritage property will sell at the same price or better than the average market. Looking at individual communities, we can see some performed extremely well:
- Heritage homes performed as high as 88% in Oakville and 92% in the Region of Haldimand-Norfolk
There was only one exception to this trend that was revealed in this Ontario study:
- Individually designated heritage properties in Prince Edward County under-performed by71% below average.
The author of the Ontario study also looked at the effect of a market downturn.
- 21% of the surveyed properties lost value greater than the average.
- 32% performed at the same rate as the average.
- 47% performed better than average.
That means, nearly 80% of the heritage homes held their value or did better during a repressed period. The same author produced a report in 1992 that focused on heritage homes in London, Ontario. While it is an older report, it suggests heritage real estate has held a certain strength in the market for a while. The research showed 64.4% of individual designated properties performed better than the average real estate market. Another 33.3% were consistent – or held their own – with the market. Only 2.2% performed below average real estate market. Acknowledging this is a smaller, restricted sample, this report suggests 97.8% of heritage properties did as well or better in the real estate market than non-heritage properties.
More information can be found on Heritage BC’s webinar-on-demand, Heritage Real Estate: Principles and Practices.